Donald Trump warned against scrapping the Trans-Pacific Partnership

11/01/2017

The US President-elect wants to scrap the TPP, calling it a "terrible deal for America". (Getty)

US President Barack Obama's departing chief trade negotiator has warned the Trump administration on Tuesday that it risks abdicating US leadership in Asia by scrapping the Trans-Pacific Partnership (TPP).

The TPP is a free trade deal covering 12 countries in the Pacific Rim, including New Zealand and Australia.

Australian Prime Minister Malcolm Turnbull says he raised the issue with president-elect Donald Trump when the two spoke soon after Trump's election win.

Michael Froman, in his final speech as US Trade Representative, said he agreed with Trump's plan to take a tough stance on trade with China, adding that the Obama administration has filed 15 challenges to that country's practices at the World Trade Organisation over eight years.

But he said withdrawing from the Trans-Pacific Partnership trade agreement would create a vacuum that China would fill as it draws countries into its own free trade deal.

"There simply is no way to reconcile a get-tough-on-China policy with withdrawing from TPP," Mr Froman said in remarks to the Washington International Trade Association.

"That would be the biggest gift any US president could give China, one with broad and deep consequences, economic and strategic."

The U.S. Congress has not approved the TPP, which the United States, Australia, Japan, Canada, Mexico and seven other countries agreed upon in October 2015.

President-elect Donald Trump has pledged to issue a formal notice of withdrawal from TPP on January 20, his first day in office.

He frequently criticised the trade deal during his campaign, calling it a "rape of our country."

Mr Froman said withdrawing would "abdicate" US leadership in the Asia-Pacific region and effectively push traditional US allies in the region "into China's arms."

China is negotiating a 16-country trade bloc that he said would set lower standards for labour, the environment, intellectual property rights, internet freedom and other key areas.

"It would be a strategic miscalculation of enormous proportions," said Mr Froman.

"Why would we cede our role as a Pacific power?" he said. "Does anyone really think US interests are better served if China, rather than the US, writes the rules of the road?"